Thomas Chien, Wu Chien-hung and Justin Huang were arrested last week, accused of fraud and stealing company secrets. Since then, new details have come to light implicating China’s Chengdu city government as part of a larger conspiracy. Prosecutors in the case have revealed that the Chengdu city government approached the three ex-members of HTC’s design team and promised to help with set-up, operation and marketing costs of a mobile design company in Chengdu as long as they were able to extract company secrets and cash before leaving HTC.

While HTC claims that Thomas Chien accessed and emailed details of the company’s Sense 6 software to external sources, prosecutors do not know if the files were sent to anyone from the Chengdu city government.

When the story originally broke, the three suspects were accused of fraudulently billing HTC for $334,000 through an external design firm for work on the HTC One. That number has now doubled to $668,300. Court documents from the first hearing show that most of the money has been recuperated, with $262,100 in cash taken from Thomas Chien’s Audi which was still parked at HTC headquarters.

With prosecutors implicating the Chengdu city government in this case, we’re sure there will be a lot more dirt to dig up on this case.